System and method for redeeming vouchers

ABSTRACT

The invention includes an improved system and method for creating, distributing and storing vouchers. The method includes a loyalty system obtaining a loyalty card account having a unique identifier and loyalty points associated therewith, accessing a loyalty database utilizing the unique identifier, converting at least a portion of the loyalty points to a first value associated with a first merchant, saving the first value in a first database associated with the loyalty card, converting at least a portion of the loyalty points to a second value associated with a second merchant, saving the second value along with other voucher information as an electronic voucher in a second database associated with the loyalty card, redeeming the first value at a first merchant and redeeming the electronic voucher at a second merchant.

CROSS REFERENCE TO RELATED APPLICATIONS

This application is a continuation of, and claims priority to, U.S. Ser.No. 10/378,462, filed on Mar. 3, 2003 and entitled “SYSTEM AND METHODFOR REDEEMING VOUCHERS.” The '462 application is a continuation-in-partof, and claims priority to, U.S. Pat. No. 7,606,730, issued on Oct. 20,2009 (aka U.S. Ser. No. 10/180,843, filed on Jun. 25, 2002 and entitled“SYSTEM AND METHOD FOR A MULTIPLE MERCHANT STORED VALUE CARD”). Both ofwhich are hereby incorporated by reference in their entirety.

FIELD OF INVENTION

The present invention relates generally to incentive and award programsand, more specifically, to a system and method for distributingvouchers.

BACKGROUND OF THE INVENTION

Loyalty systems (also known as promotion or incentive systems) weredeveloped, in part, to not only motivate the consumer to purchase aparticular item, but also to promote consumer loyalty to a merchant,transaction card or service provider. Generally, such programs rewardconsumers for buying a particular product or conducting repeat businesswith the same merchant by issuing a coupon, distributing a loyalty cardor issuing loyalty points. Whether the coupon or card is issued directlyor in exchange for loyalty points, consumers typically accumulatevarious coupons, loyalty cards and certificates from different merchantswherein the coupons often include, for example, purchase requirements ordate restrictions. As such, consumers typically must wait to receive thecertificate or card in the mail, spend time organizing the variouscoupons from different merchants and determining which product topurchase in order to obtain the benefit of a particular coupon.Moreover, consumers typically retain the coupons along with their otherforms of payment in order to remind them to use the coupons when theyare shopping at a particular merchant. Furthermore, the expiration datesmust be monitored in order to avoid losing the ability to utilize thecoupon and the coupons often can only be redeemed during one purchasetransaction, so the full amount of the coupon must be used at once orthe remaining value is usually lost.

In addition to coupons or certificates, merchants may issue loyaltypoints to a consumer account associated with a merchant specific loyaltycard. However, because numerous merchants participate in loyaltyprograms, consumers often retain many loyalty cards, each having adifferent loyalty account number along with different rules andrequirements. Moreover, after accumulating loyalty points, the consumerthen redeems the loyalty points in various ways, including exchangingthe loyalty points for additional goods and services. For example, therewards may be selected from a merchant approved list or a merchantredemption catalog. The loyalty points are usually calculated using apredetermined formula or ratio that relates a consumer's purchase volume(i.e., in terms of money value or some other volume parameter) to acertain number of loyalty points. For example, loyalty points may beissued on a one-for-one basis with each dollar that a consumer spends onparticular goods and services. Loyalty points may also be issued basedupon a consumer meeting a pre-defined rule such as, frequency ofpurchases at a merchant or frequency of purchasing a particular product.However, the consumer needs to remember or keep track of loyalty pointbalances and reward options from various merchants.

One well-known example of a consumer incentive program is a “frequentflyer” program which usually issues an airline specific frequent flyercard, then rewards airline passengers with “mileage points” based uponthe distances that the passengers fly with a particular airline. Themileage points may then be redeemed for free airfare or free carrentals. Other incentive award programs are designed to induce usage ofparticular financial instruments, such as credit cards or debit cards,by accumulating loyalty points or dollar value points based upon thevolume of purchases made using the particular financial instrument.These types of programs may be designed such that clients of thefinancial institution accumulate loyalty points which can be redeemedfor selected goods or services or, alternatively, consumers accumulatepoints which have a dollar value which can be applied toward a credit ordebit balance, depending on whether the instrument is a credit or debitinstrument, for example.

Because of the numerous coupons, certificates, and loyalty cards thatare typically retained by consumers, a need exists to consolidate theloyalty programs from various merchants into a centralized databasewherein, for each consumer, the database can monitor loyalty pointbalances for various merchants. Moreover, a need exists for the consumerto access the database using one code or loyalty account number.

In addition to the distribution and use of coupons, certificates,loyalty cards and loyalty points, a need exists for a more efficientsystem of distributing vouchers to consumers. Consumers typicallyreceive in the mail numerous coupon booklets, rebate checks, andenvelopes full of post card advertisements. Many times, the consumerwill not review the entire packet of promotions; rather, the consumerwill simply toss the envelope of promotions in the garbage withoutreviewing the contents. If the consumer spends the time reviewing thevarious promotions, the consumer may only select a very small subset ofpromotions to save for later use. The consumer will often save the fewpromotions in a drawer or folder which usually causes the consumer toforget about the promotions. Moreover, the sponsors of these promotionsoften do not have an adequate method for monitoring, tracking andanalyzing the success of such promotions. For example, the promotionsmay be given by the recipient to a different consumer which utilizes thepromotion, so the sponsors would be misled about the incentive effect ofthe promotion on the target recipient group. Furthermore, in somesituations, the consumer may unethically attempt to copy or reproducethe promotion in order to wrongly obtain repeated benefits from thepromotion. As such, a need exists for an improved system fordistributing a voucher to consumers that results in increased use of thevouchers and decreased fraud.

SUMMARY OF THE INVENTION

In an exemplary embodiment, the invention includes a loyalty systemwhich allows a consumer to accumulate general loyalty points from one ormore merchants, then convert any desired subset of general loyaltypoints to loyalty dollars (or monetary equivalent) associated with aspecific merchant. The system stores, for each consumer, the loyaltydollars by merchant within a remotely-accessible host database, withinthe magnetic stripe or within a smart card database. Upon conducting apurchase at a particular merchant, the consumer may utilize a consumerID (code key) to facilitate access to the consumer's own loyalty dollarsfor the particular merchant. The loyalty dollars are then applied to thepurchase transaction as a discount or rebate. The consumer may alsore-load the loyalty dollars.

The system and method facilitates the redemption of loyalty points byobtaining a loyalty card having a unique identifier and loyalty pointsassociated therewith; accessing a loyalty database utilizing the uniqueidentifier; converting at least a portion of the loyalty points to afirst value associated with a first merchant; saving the first value ina first database associated with said loyalty card; converting at leasta portion of the loyalty points to a second value associated with asecond merchant; saving the second value in a second database associatedwith the loyalty card account; redeeming the first value at the firstmerchant; and, redeeming the second value at the second merchant. Theloyalty point account may also be re-loaded by converting at least aportion of the loyalty points to a third value associated with a firstmerchant; and saving the third value in a first database associated withthe loyalty card account.

The invention includes an improved system and method for creating,distributing and storing vouchers. The method includes receiving aconsumer ID, determining a promotion based upon the consumer ID,producing a voucher by associating the promotion with the voucher, andstoring the voucher in a remotely accessible database having data fieldsrelated to different merchants. Alternatively, the voucher may be storedin a smart card database having data fields related to differentmerchants. The system then enables the consumer to receive the voucherand to use the promotion associated with the voucher for a purchase froma merchant.

In another embodiment, the loyalty system facilitates obtaining aloyalty card account having a unique identifier and loyalty pointsassociated therewith, accessing a loyalty database utilizing the uniqueidentifier, converting at least a portion of the loyalty points to afirst value associated with a first merchant, saving the first value ina first database associated with the loyalty card, converting at least aportion of the loyalty points to a second value associated with a secondmerchant, saving the second value along with other voucher informationas an electronic voucher in a second database associated with theloyalty card, redeeming the first value at a first merchant andredeeming the electronic voucher at a second merchant.

BRIEF DESCRIPTION OF THE DRAWINGS

The accompanying drawings, wherein like numerals depict like elements,illustrate exemplary embodiments of the present invention, and togetherwith the description, serve to explain the principles of the invention.In the drawings:

FIG. 1 is a schematic block diagram illustrating an exemplary incentivesystem in accordance with various aspects of the present invention;

FIG. 2 is a schematic block diagram illustrating details of an exemplaryincentive engine and database in accordance with various aspects of thepresent invention; and,

FIG. 3 is a flowchart illustrating an exemplary process for theoperation of the multiple merchant stored value system in accordancewith various aspects of the present invention.

DETAILED DESCRIPTION

In general, the loyalty system of the present invention facilitates theconversion of a subset of general loyalty points to merchant-specificloyalty dollars, stores for each consumer the loyalty dollars bymerchant within a database and allows the consumer to utilize thevarious merchant loyalty dollars using a single code key or consumer ID.The loyalty dollars may then be applied to the purchase transaction as amonetary equivalent, discount or rebate. When desired, the consumer mayalso re-load the loyalty card account by converting additional loyaltypoints to merchant dollars.

The present system and method provides a simpler and efficient consumerexperience because the consumers will not need to carry multiplecoupons, gift certificates or stored value cards in order to obtainrewards at multiple merchants. Moreover, the system does not need toissue multiple stored value cards or certificates upon each consumerrequest to redeem points for a gift card or certificate. With thereduced amount of cards to create and distribute, along with reducedservicing costs associated with servicing lost or stolen certificatesand/or stored value cards, the present loyalty system is less expensiveto implement (e.g., reduced overhead, inventory and operating costs).Moreover, because the loyalty system is more convenient, consumerengagement is increased (e.g., more points earned) and the system mayaccelerate point redemption which may allow the loyalty system andmerchants to recognize increased revenue and utilization of promotionson an accelerated schedule.

The detailed description herein of exemplary embodiments of theinvention makes reference to the accompanying drawings, which show theexemplary embodiment by way of illustration. While these exemplaryembodiments are described in sufficient detail to enable those skilledin the art to practice the invention, it should be understood that otherembodiments may be realized and that logical and mechanical changes maybe made without departing from the spirit and scope of the invention.Thus, the following detailed description is presented for purposes ofillustration only and not of limitation, and the scope of the inventionis defined solely by the appended claims when properly read in light ofthe following description.

Moreover, it should be appreciated that the particular implementationsshown and described herein are illustrative of the invention and itsbest mode and are not intended to otherwise limit the scope of thepresent invention in any way. Indeed, for the sake of brevity,conventional data networking, application development and otherfunctional aspects of the systems (and components of the individualoperating components of the systems) may not be described in detailherein. Furthermore, the connecting lines shown in the various figurescontained herein are intended to represent exemplary functionalrelationships and/or physical couplings between the various elements. Itshould be noted that many alternative or additional functionalrelationships or physical connections may be present in a practicalelectronic transaction system.

As will be appreciated by one of ordinary skill in the art, the presentinvention may be embodied as a method, a data processing system, adevice for data processing, and/or a computer program product.Accordingly, the present invention may take the form of an entirelysoftware embodiment, an entirely hardware embodiment, or an embodimentcombining aspects of both software and hardware. Furthermore, thepresent invention may take the form of a computer program product on acomputer-readable storage medium having computer-readable program codemeans embodied in the storage medium. Any suitable computer-readablestorage medium may be utilized, including hard disks, CD-ROM, opticalstorage devices, magnetic storage devices, and/or the like.

The present invention is described herein with reference to blockdiagrams and flowchart illustrations of methods, apparatus (e.g.,systems), and computer program products according to various aspects ofthe invention. It will be understood that each functional block of theblock diagrams and the flowchart illustrations, and combinations offunctional blocks in the block diagrams and flowchart illustrations,respectively, can be implemented by computer program instructions. Thesecomputer program instructions may be loaded onto a general purposecomputer, special purpose computer, or other programmable dataprocessing apparatus to produce a machine, such that the instructionswhich execute on the computer or other programmable data processingapparatus create means for implementing the functions specified in theflowchart block or blocks.

These computer program instructions may also be stored in acomputer-readable memory that can direct a computer or otherprogrammable data processing apparatus to function in a particularmanner, such that the instructions stored in the computer-readablememory produce an article of manufacture including instruction meanswhich implement the function specified in the flowchart block or blocks.The computer program instructions may also be loaded onto a computer orother programmable data processing apparatus to cause a series ofoperational steps to be performed on the computer or other programmableapparatus to produce a computer-implemented process such that theinstructions which execute on the computer or other programmableapparatus provide steps for implementing the functions specified in theflowchart block or blocks.

Accordingly, functional blocks of the block diagrams and flowchartillustrations support combinations of means for performing the specifiedfunctions, combinations of steps for performing the specified functions,and program instruction means for performing the specified functions. Itwill also be understood that each functional block of the block diagramsand flowchart illustrations, and combinations of functional blocks inthe block diagrams and flowchart illustrations, can be implemented byeither special purpose hardware-based computer systems which perform thespecified functions or steps, or suitable combinations of specialpurpose hardware and computer instructions.

The incentive engine 102 may be a stand-alone system or incorporatedinto any pre-existing transaction system or loyalty system via anysoftware and/or hardware customization or upgrades. For example, theloyalty system 100 may provide a turn-key loyalty solution forparticipating merchants such that consumers may earn points bypresenting a pre-established consumer ID or code key at the point ofsale 112. Incentive engine 102 and/or related databases may be stored ina remote system and accessed via any communication network discussedherein. In another embodiment, incentive engine 102 may exist within aportable device having a processor, such as a smart card, personaldigital assistant, laptop or other portable processor of information. Inthe these embodiments, any one or more of processing functions, memoryand/or databases may be stored locally on the smart card or otherdevice. In another embodiment, the merchant dollars and other data maybe encoded into the card, such as, for example, into a magnetic stripe,bar code, optical device and/or the like. In this manner, remote accessis not necessary and when the value on the card is extinguished, theuser may simply dispose of the card, obtain a new card or re-load thecard with additional value. Alternatively, any combination of remoteaccessibility or local access is contemplated.

Consumers may participate in the system when shopping at a “brick andmortar” store or on the internet, for example, at a particular merchant,at a chain of merchants, at a coalition of merchants or within a groupof merchants located within a shopping mall. The loyalty system mayprovide the platform for recording where consumers shop, earning pointsby consumers and for billing merchants for points accordingly. Inaddition to earning base points, consumers may also be able to earnbonus points through bonus point promotions. In this regard, merchantsmay offer bonus points to incent consumers to trial a new product or toincrease the frequency of high margin purchases.

In other embodiments of loyalty system 100, the reward may also beearned from buying specific products based upon the association of UPCdata and merchant SKU data. Rather than simply capturing transactions ata Record of Charge (ROC) level, that is, recording consumer purchases ina general fashion by designating purchase categories (such as“clothing”, “electronics”, or “hardware” for example), the systemidentifies the particular item purchased (such as “jeans”, “stereo”, or“hammer” for example) as well as its corresponding manufacturer. Bymatching or associating the merchant SKU and the manufacturer's UPC, thesystem facilitates the standardization of goods and/or services codes atthe network level. This standardization not only permits a record ofboth the specific item purchased and its manufacturer, regardless of theparticular merchant involved in the transaction, but it permits themapping of multiple consumers, multiple goods and/or services, multiplemerchants, and/or multiple manufacturers to advantageously cross-marketgoods and services to consumers and allow the issuance of loyalty pointsbased on the UPC and/or SKU data. For more information related to theassociation of UPC data and merchant SKU data, see for example, U.S.patent application Ser. No. 09/836,213, filed on Apr. 17, 2001 byinventors Voltmer, et al. and entitled System And Method For NetworkedLoyalty Program, which is hereby incorporated by reference. Afterearning the loyalty points, consumers may be allowed to redeem theloyalty points for cash off new purchases at participating merchantsalong with other redemption options such as, for example, merchandise,travel packages and/or the like.

In general, in loyalty system 100, the incentive engine 102 maintains anaccount for each participating consumer along with general loyaltypoints and merchant-specific loyalty dollars The system may also apprisethe consumer of the loyalty point totals and account activity, forexample, in one embodiment, the consumer can view the balance of loyaltypoints and/or newly issued loyalty points via the POS terminal 112during a purchase transaction, as more fully described below.Additionally, the consumer may review the total number of points in theaccount either online or off-line, such as through a periodic statementsent by the loyalty system 100 or through the use of a communicationsnetwork, such as the Internet, for example. Points in the consumer'saccount may be accumulated across multiple merchants and/ormanufacturers participating in the system. Thus, points earned by aconsumer based upon transactions with different merchants and/ormanufacturers may be combined, resulting in a rapid accrual of points.The loyalty system 100 may offer a pre-established reward or a catalogof products and services, which may be either online or off-line, fromwhich consumers may select rewards in exchange for accrued points. Inthis manner, consumers advantageously earn points based upon theireveryday purchases of products and services, these points are accruedacross merchants and/or manufacturers, and points redemption may takeplace through a single, universal catalog of rewards. The points may beredeemed for cash, products, services or categories of the same. Forexample, a consumer may redeem points for a pair of Gap jeans (SKU 1234)and an 8 ounce container of Hagen Daas ice crème anywhere within thecoalition of merchants, a subset of merchants or from other merchants(off-line or on-line).

For more information on loyalty systems and transaction systems, see forexample, U.S. Continuation-In-Part patent application Ser. No.10/027,984 filed on Dec. 20, 2001 by inventors Ariff, et al. and isentitled System And Method For Networked Loyalty Program; U.S.Continuation-In-Part patent application Ser. No. 10/010,947 filed onNov. 6, 2001 by inventors Haines, et al. and is entitled System AndMethod For Networked Loyalty Program; U.S. Continuation-In-Part patentapplication Ser. No. 10/084,744 filed on Feb. 26, 2002 by inventorsBishop, et al. and is entitled System And Method For Securing DataThrough A PDA Portal; the Shop AMEX™ system as disclosed in Ser. No.60/230,190 filed Sep. 5, 2000; the MR as Currency™ and Loyalty RewardsSystems disclosed in Ser. No. 60/197,296 filed on Apr. 14, 2000, Ser.No. 60/200,492 filed Apr. 28, 2000, Ser. No. 60/201,114 filed May 2,2000; a stored value card as disclosed in Ser. No. 09/241,188 filed onFeb. 1, 1999; all of which are herein incorporated by reference.Moreover, other examples of an online membership reward systems aredisclosed in Netcentives' U.S. Pat. No. 5,774,870, issued on Jun. 30,1998, and U.S. Pat. No. 6,009,412, issued on Dec. 29, 1999, both ofwhich are hereby incorporated by reference.

As used herein, points or merchant dollars may include any incentive,loyalty, award, reward, motivation, performance, purchased, exchanged,earned or any other points which may be acquired by or for a consumer.The points may or may not have monetary equivalents. The value of anymonetary equivalents may vary or change based on a time period,promotion period, pre-established period, merchant directed criteriaand/or the like. Points, as discussed herein, may also include cash,products and/or product categories. For example, a consumer may beawarded a free or reduced price product, the ability to obtain a productupon meeting certain conditions and/or the like.

General loyalty points may include any points that are acquired orearned by a consumer from any source. Merchant-specific loyalty points(loyalty dollars, merchant dollars or the like) may include any pointswhich are earned or acquired directly from a merchant or group ofmerchants and/or are converted from general loyalty points. Moreover,the merchant dollars may have monetary equivalents may vary or changebased on a time period, promotion period, pre-established period,merchant directed criteria and/or the like and which may be used as adiscount or rebate.

A consumer may include any person, entity, charitable organization,merchant, business, hardware and/or software which participates in thepresent system and may utilize a code key. A code key includes anyconsumer ID, device, code, code key or other identifier suitablyconfigured to allow the consumer to interact or communicate with thesystem, such as, for example, a rewards card, charge card, credit card,debit card, prepaid card, telephone card, smart card, magnetic stripecard, bar code card, transponder, authorization/access code, personalidentification number (PIN), Internet code, other identification code,and/or the like. Additionally, a consumer ID may include any form ofelectronic, magnetic, wireless and/or optical device capable oftransmitting or downloading data from itself to a second device which iscapable of interacting and communicating with such forms of consumer ID.A consumer profile may include any data used to characterize a consumerand/or the behavior of a consumer. In the context of a commercialtransaction, a consumer profile may include, for example, the time anddate of a particular purchase, the frequency of purchases, thevolume/quantity of purchases, the transaction size (price), and/or thelike. Any aspects of the consumer profile may be used in the context ofdata analysis.

Merchant may include any person, website, retailer, manufacturer,distributor, financial institution, issuer, acquirer, consumer,hardware, software or any other entity that desires to participate inthe loyalty system 100. Merchant ID includes any symbol, indicia, code,number, or other identifier that may be associated with a merchant ofany type of goods and/or services offered to a consumer or otherend-user. A merchant ID may also include or be associated with a storeID, which designates the location of a particular store. A third-partyprovider may include any additional provider of goods and/or services toa consumer. Specifically, a third-party provider includes any partyother than the particular manufacturer and merchant who is involved in atransaction with a consumer. A third-party provider may include, forexample, a financial institution, such as a bank or an issuer of afinancial instrument (such as a credit card or a debit card). Athird-party provider may also include a provider of goods and serviceswhich are offered as awards to consumers in exchange for a requisitenumber of loyalty points.

Purchase data may include data relating to the offer of any item to aconsumer or other end-user. Purchase data may include any of thefollowing: an item purchased, an item price, a number of itemspurchased, a total transaction price, a payment vehicle, a date, a storeidentifier, an employee identifier, a merchant item identifier, aloyalty identifier, and/or the like. An award or reward may include anyquantity of products, services, coupons, gift certificates, rebates,loyalty points, bonus points, credits or debits to a financialinstrument, and/or the like.

Though the invention may generically be described with reference to aseries of transactions which transfer a good or service from anoriginating party to an intermediary party and a subsequent transactionwhich transfers the good or service from the intermediary party to anend-user of that good or service, for convenience and purposes ofbrevity and consistency, the present disclosure generally refers to theoriginating party as a manufacturer, the intermediary party as amerchant, the end-user as a consumer, and a good or service as a productor item. However, it will be recognized by those of ordinary skill inthe art that the merchant need not provide a product or item to aconsumer in exchange for monetary currency. While this often may be thecase, the present disclosure is not so limited and includes transactionswhich may be gratuitous in nature, whereby the merchant transfers aproduct or item to a consumer without the consumer providing anycurrency or other value in exchange. It is further noted that additionalparticipants, referred to as third-party providers, may be involved insome phases of the transaction, though these participants are not shown.Exemplary third-party providers may include financial institutions, suchas banks, credit card companies, card sponsoring companies, or issuersof credit who may be under contract with financial institutions. It willbe appreciated that any number of consumers, merchants, manufacturers,third-party providers, and the like may participate in the system of thepresent invention.

The system may include a host server or other computing systemsincluding a processor for processing digital data, a memory coupled tosaid processor for storing digital data, an input digitizer coupled tothe processor for inputting digital data, an application program storedin said memory and accessible by said processor for directing processingof digital data by said processor, a display coupled to the processorand memory for displaying information derived from digital dataprocessed by said processor and a plurality of databases, said databasesincluding client data, merchant data, financial institution data and/orlike data that could be used in association with the present invention.As those skilled in the art will appreciate, user computer willtypically include an operating system (e.g., Windows NT, 95/98/2000,Linux, Solaris, etc.) as well as various conventional support softwareand drivers typically associated with computers. User computer can be ina home or business environment with access to a network. In an exemplaryembodiment, access is through the Internet through acommercially-available web-browser software package.

Communication between the parties to the transaction and the system ofthe present invention is accomplished through any suitable communicationmeans, such as, for example, a telephone network, Intranet, Internet,point of interaction device (point of sale device, personal digitalassistant, cellular phone, kiosk, etc.), online communications, off-linecommunications, wireless communications, and/or the like. One skilled inthe art will also appreciate that, for security reasons, any databases,systems, or components of the present invention may consist of anycombination of databases or components at a single location or atmultiple locations, wherein each database or system includes any ofvarious suitable security features, such as firewalls, access codes,encryption, de-encryption, compression, decompression, and/or the like.

The computers utilized in the present invention may provide a suitablewebsite or other Internet-based graphical user interface which isaccessible by users. In one embodiment, the Internet Information Server,Microsoft Transaction Server, and Microsoft SQL Server, are used inconjunction with the Microsoft operating system, Microsoft NT web serversoftware, a Microsoft SQL database system, and a Microsoft CommerceServer. Additionally, components such as Access or SQL Server, Oracle,Sybase, Informix MySQL, Intervase, etc., may be used to provide anADO-compliant database management system. The term “webpage” as it isused herein is not meant to limit the type of documents and applicationsthat might be used to interact with the user. For example, a typicalwebsite might include, in addition to standard HTML documents, variousforms, Java applets, Javascript, active server pages (ASP), commongateway interface scripts (CGI), extensible markup language (XML),dynamic HTML, cascading style sheets (CSS), helper applications,plug-ins, and the like.

In an exemplary embodiment, and with reference to FIG. 1, merchantsystem 104 includes a merchant terminal 108 and a merchant processor 110in communication with merchant database 111. Merchant terminal 108includes any software, hardware and/or device capable of facilitatingreceipt, identification and/or transmission of a consumer ID. Exemplarydevices for identifying a consumer ID may include a keypad, aconventional card reader which recognizes a magnetic stripe or bar codeassociated with a consumer ID, a biometric device, a smart card readerwhich recognizes information stored on a microchip integrated with aconsumer ID, and/or any device capable of receiving or uploadingconsumer ID data transmitted electronically, magnetically, optically,and/or the like. In one embodiment, merchant terminal 108 and merchantprocessor 110 are co-located at a retail store. In another embodiment,retail terminal 108 and merchant processor 110 are remote from eachother.

In an exemplary embodiment, as again illustrated in FIG. 1, merchantterminal 108 includes a merchant POS terminal 112, such as a cashregister, a magnetic stripe card reader, a smart card reader, a bar codescanner and/or the like. POS terminal 112 includes a suitable display orprinting device configured to display and/or print loyalty pointinformation in accordance with the present invention. When a consumer IDis used at the time an item is purchased, purchase data, which mayinclude a SKU number, price, etc, is input, sensed, or otherwiserecognized by terminal 108, and then the purchase data is processed andstored by merchant processor 110. Merchant processor 110 includes or isin communication with a suitable database 111 or other storage devicefor maintaining and storing purchase data and any other suitablemerchant information. Database 111 may be any type of database, such asany of the database products and functions described herein for example.Database 111 may be organized in any suitable manner, including datatables or lookup tables. Purchase data that is stored in database 111 isavailable to the merchant's local back office system (not shown) forinventory, accounting, tax, data analysis, and/or other purposes. Thecaptured purchase data may include the item purchased, the item's unitprice, the number of items purchased, the date, the store location, anemployee ID, and any other information related to the purchase. In anexemplary embodiment, merchant processor 110 may also receive, process,and store manufacturer data, such as information regarding productsand/or services and UPC data. The manufacturer data may be stored in anysuitable form, including data tables or lookup tables.

In alternative exemplary embodiments (not shown), purchase data may alsobe transmitted to and stored and processed by a merchant regionalprocessor (or, alternatively, a merchant national database (not shown))in communication with another database for the purpose of further backoffice and cumulative data analysis. In an exemplary embodiment,merchant processor 110 optionally may be integrated with a merchantregional processor, thereby forming a single device. In anotherembodiment, merchant processor 110 and merchant regional processor areseparate devices which may be either co-located with each other orremotely located from one another. For example, in one embodiment,merchant processor 110 and regional processor are co-located at aparticular retail store. In another embodiment, merchant processor 110is located at a particular retail store and merchant regional processoris remotely located at a regional office.

Regardless of the location of merchant regional processor, merchantregional processor receives and processes similar information from eachof the merchant processors 110 associated with each of the retail storesowned by the same merchant. Whether the system 100 includes a merchantregional processor or a merchant national processor may be a function ofthe number of stores maintained by a particular merchant. That is, alarger merchant who has numerous stores throughout a country or region,for example, may choose to have a plurality of regional processors,while a smaller merchant with a few stores scattered across a countrymay be better served by a single, national processor. In exemplaryembodiments, the merchant regional processors and/or national processorscommunicate with a suitable database or other storage device which isconfigured to store and maintain purchase data and any other suitablemerchant information. In another exemplary embodiment, the merchantregional processor may receive, process, and store manufacturer data,such as information regarding products and/or services and UPC data. Themanufacturer data may be stored in any suitable form, including datatables or lookup tables.

In another exemplary embodiment, loyalty system 100 further includes aconsumer terminal 118. Consumer terminal 118 includes any remoteterminal through which a consumer may access other aspects of the system100. Consumer terminal 118 may include any of the input devices,computing units, or computing systems described herein, such as, forexample, kiosk, personal digital assistant, handheld computer (e.g.,Palm Pilot®, Blackberry®), cellular phone and/or the like. Further,consumer terminal 118 communicates with the system 100 through any ofthe communications networks described herein. In one embodiment,consumer terminal 118 permits a consumer to engage multiple facets ofthe system 100 in an interactive online communications environment. Theinteractive online environment made available through consumer terminal118 is an extension of the network-level incentive award program and isimplemented in conjunction with other aspects of the system 100. In thiscontext, a consumer may use consumer terminal 118 for a variety ofpurposes. In one embodiment, consumer terminal 118 may be used tocommunicate with and receive information from incentive engine 102.Incentive engine 102 may also send or push any of the informationdiscussed herein to consumer terminal 118. For example, a consumer mayuse consumer terminal 118 to do any of the following: enroll in thesystem; receive statements or reports regarding accumulated generalloyalty points totals or merchant-specific loyalty point totals; receivebonus details; view potential awards which the consumer may obtain inexchange for various numbers of points; select an award; receiveredemption information; view points adjustments; redeem loyalty pointsfor a selected award; request and/or receive a loyalty points advisorystatement; receive information regarding where and how points wereearned and/or how points were redeemed; receive information regardingexpiration dates for points earned; receive information relating to anyapplicable fees; receive information regarding marketing promotions;and/or view a directory of participating merchants, manufacturers,and/or third-party providers.

In another embodiment, consumer terminal 118 may be used to interactwith and/or make purchases and generate loyalty points fromparticipating online merchants, as illustrated by the various phantomlines in FIG. 1. The online merchant may then communicate with theincentive engine 102 to transmit and process a consumer ID, purchasedata, etc., as described above with reference to merchant 104 of FIG. 1.Information communicated between the online consumer, the onlinemerchant, and the online incentive engine may include, for example,product or service information, prices, availability of the product orservice, shipping information, loyalty points information, availableawards, information regarding points ratios and points redemption,and/or the like. In one embodiment, consumer terminal 118 operates inreal-time, as described above with respect to incentive engine 102. Inanother embodiment, the consumer terminal 118 may operate in batch mode,as described above. In still a further embodiment, consumer terminal 118operates in a manner which includes aspects of both real-timefunctionality and batch mode functionality.

With reference again to FIG. 1, a consumer may be updated with regard tovarious aspects of the system via incentive engine 102. For example,incentive engine 102 may inform consumers of the number of loyaltypoints that they have accumulated from all system merchants generally orthe merchant-specific points from a particular merchant and the types ofawards that may be obtained using those loyalty points. Moreover,incentive engine 102 may suggest to the consumer various awards forwhich the consumer is eligible based upon the loyalty points generatedby the consumer's network-wide purchases. In this context, network-widepurchases include any purchases of items corresponding to merchantsparticipating in the loyalty system 100. A consumer may use incentiveengine 102 to facilitate, for example, any of the following: viewaccumulated general loyalty points totals or merchant-specific loyaltydollars; view potential awards which the consumer may obtain in exchangefor various numbers of points; select an award; redeem loyalty pointsfor a selected award; request and/or receive a loyalty points advisorystatement; and/or view a directory of participating merchants,manufacturers, and third-party providers.

In an exemplary embodiment, incentive engine 102 operates in real-time.In this context, “real-time” means that loyalty points are immediately,or nearly immediately, updated at the time purchases are made and aretherefore immediately redeemable by the consumer at the point of sale.Moreover, the consumer may convert general loyalty points tomerchant-specific loyalty dollars or re-load any merchant loyalty dollardatabase immediately, or nearly immediately. Thus, for example, aconsumer may be informed by incentive engine 102 at the point of salethat the item being purchased by the consumer may be purchased using theconsumer's accumulated loyalty points, including points accumulated on anetwork level. Points accumulated on a network level enable consumers toaccumulate points more rapidly than would be possible if only a singlemerchant or group of merchants were issuing the points. In oneembodiment, incentive engine 102 may update a consumer's loyalty pointsin real-time and, in response to the consumer's particular points total,issue a free product, a coupon, a gift certificate, and/or additionalbonus points to the consumer.

In another exemplary embodiment, the system may operate partially inreal-time and partially in batch mode, wherein during batch mode, pointstotals are calculated, stored, and periodically updated for access bythe merchant terminal 108, including POS terminal 112 and/or incentiveengine 102. Thus, in this embodiment, the consumer may be notified ofcertain available points sometime after a purchase, or a suggestive salemay take place after a purchase. The total point count or suggestivesale may take into account points generated and accumulated as theresult of network-wide purchases.

More particularly, with reference to FIG. 2, the incentive engine 102manages the incentive portion of system 100. In an exemplary embodiment,incentive engine 102 receives, processes, and/or stores data in theapplicable databases 220 including, for example, participating merchantdatabase 250, consumer accounts database 260, promotion rules database280 and consumer purchase records 290. The incentive engine 102 mayreceive and process consumer ID information and/or purchase data fromany of the merchant systems 104 and/or consumer terminal 118. Theincentive engine 102 may also associate a particular consumer ID withthe purchase data and a corresponding manufacturer item identifier. Inone embodiment, the incentive engine 102 performs an analysis involvingany of the following: a consumer ID, purchase data, a points ratio, aconsumer profile, a merchant ID, and a manufacturer ID. The analysis maybe dependent upon an the association of the consumer IDs, the purchasedata, and the manufacturer item identifier. The analysis may furtherinclude, for example, a calculation of loyalty points and/or otheranalyses for purposes of market segmentation, determining consumerspending behavior, correlating spending behavior and consumerdemographics, and/or the like.

The databases discussed herein (e.g., 250, 260, 270, 280, 290 and 111)may be any type of database, such as relational, hierarchical,object-oriented, and/or the like. Common database products that may beused to implement the databases include DB2 by IBM (White Plains, N.Y.),any of the database products available from Oracle Corporation (RedwoodShores, Calif.), Microsoft Access or MSSQL by Microsoft Corporation(Redmond, Wash.), or any other database product. Database may beorganized in any suitable manner, including as data tables or lookuptables. Association of certain data may be accomplished through any dataassociation technique known and practiced in the art. For example, theassociation may be accomplished either manually or automatically.Automatic association techniques may include, for example, a databasesearch, a database merge, GREP, AGREP, SQL, and/or the like. Theassociation step may be accomplished by a database merge function, forexample, using a “key field” in each of the manufacturer and merchantdata tables. A “key field” partitions the database according to thehigh-level class of objects defined by the key field. For example, acertain class may be designated as a key field in both the first datatable and the second data table, and the two data tables may then bemerged on the basis of the class data in the key field. In thisembodiment, the data corresponding to the key field in each of themerged data tables is preferably the same. However, data tables havingsimilar, though not identical, data in the key fields may also be mergedby using AGREP, for example.

With continued reference to FIG. 2, an exemplary incentive engine 102includes a central processor 204 in communication with other elements ofthe incentive engine 102 through a system interface or bus 206. Asuitable display device/input device 208, such as a keyboard or pointingdevice in combination with a monitor, may be provided for receiving datafrom and outputting data to a user of loyalty system 100. A memory 210associated with the incentive engine 102 includes various softwaremodules, such as, for example, an enrollment module 212 and anauthentication module 214 for example. The memory 210 preferably furtherincludes an operating system 216 which enables execution by processor204 of the various software applications residing at enrollment module212 and authentication module 214. Operating system 216 may be anysuitable operating system, as described herein. Preferably, a networkinterface 218 is provided for suitably interfacing with other elementsof the loyalty system 100, such as the elements described herein withreference to FIGS. 1-2.

It will be appreciated, that many applications of the present inventioncould be formulated. One skilled in the art will appreciate that thenetwork interface 218 may interface with any system for exchanging dataor transacting business, such as the Internet, an intranet, an extranet,WAN, LAN, satellite communications, and/or the like. It is noted thatthe network may be implemented as other types of networks, such as aninteractive television (ITV) network. The users may interact with thesystem via any input device such as a keyboard, mouse, kiosk, personaldigital assistant, handheld computer (e.g., Palm Pilot®), cellular phoneand/or the like. Similarly, the invention could be used in conjunctionwith any type of personal computer, network computer, workstation,minicomputer, mainframe, or the like running any operating system suchas any version of Windows, Windows NT, Windows2000, Windows 98, Windows95, MacOS, OS/2, BeOS, Linux, UNIX, Solaris or the like. Moreover,although the invention is frequently described herein as beingimplemented with TCP/IP communications protocols, it will be readilyunderstood that the invention could also be implemented using IPX,Appletalk, IP-6, NetBIOS, OSI or any number of existing or futureprotocols. Moreover, the system contemplates the use, sale ordistribution of any goods, services or information over any networkhaving similar functionality described herein.

The computing units may be connected using network interface 218 witheach other via a data communication network. The network may be a publicnetwork and assumed to be insecure and open to eavesdroppers. In theillustrated implementation, the network may be embodied as the internet.In this context, the computers may or may not be connected to theinternet at all times. For instance, the consumer computer may employ amodem to occasionally connect to the internet, whereas the merchantcomputing center might maintain a permanent connection to the internet.Specific information related to the protocols, standards, andapplication software utilized in connection with the Internet may not bediscussed herein. For further information regarding such details, see,for example, DILIP NAIK, INTERNET STANDARDS AND PROTOCOLS (1998); JAVA 2COMPLETE, various authors, (Sybex 1999); DEBORAH RAY AND ERIC RAY,MASTERING HTML 4.0 (1997). LOSHIN, TCP/IP CLEARLY EXPLAINED (1997). Allof these texts are hereby incorporated by reference.

The systems may be suitably coupled to network via data links, such asnetwork interface 218. A variety of conventional communications mediaand protocols may be used for data links. Such as, for example, aconnection to an Internet Service Provider (ISP) over the local loop asis typically used in connection with standard modem communication, cablemodem, Dish networks, ISDN, Digital Subscriber Line (DSL), or variouswireless communication methods. Merchant system might also reside withina local area network (LAN) which interfaces to network via a leased line(T1, D3, etc.). Such communication methods are well known in the art,and are covered in a variety of standard texts. See, e.g., GILBERT HELD,UNDERSTANDING DATA COMMUNICATIONS (1996), hereby incorporated byreference.

Each participant may be equipped with a computing system to facilitateonline commerce transactions. The consumer has a computing unit in theform of a personal computer, although other types of computing units maybe used including laptops, notebooks, hand held computers, set-topboxes, and the like. The merchant has a computing unit implemented inthe form of a computer-server, although other implementations arepossible.

With continued reference to FIG. 2, enrollment module 212 of incentiveengine 102 receives information from consumers or merchants who wish toparticipate in the system. Enrollment module 212 accesses and storesinformation in storage device 220. Authentication and/or validation ofthe identity and status of participants, including any of the othersystem components, may be performed by the authentication module 214,which preferably has access to the records residing in storage device220.

Storage device 220, such as a hard disk drive for example, includesfiles or records which are accessed by the various software modules,such as enrollment module 212 and authentication module 214. One skilledin the art will appreciate that the storage device 220, and thereforethe various databases associated therewith, may be co-located with theincentive engine 102 or may be remotely located with respect to theincentive engine 102. If the storage device 220 is remotely located withrespect to the incentive engine 102, communication between storagedevice 220 and incentive engine 102 may be accomplished by any suitablecommunication link but is preferably accomplished through a privateintranet or extranet. Moreover, the data discussed herein may betemporarily or permanently located in one database, located in multipledatabases or shared among databases in order to facilitate the functionsdescribed herein.

In particular, consumer accounts database 260 may include consumer IDinformation, information received from a consumer upon registration withthe incentive engine 102 and general loyalty point or merchant-specificloyalty dollar information. For each consumer or group of consumers,consumer accounts database 260 may include a consumer account balancedatabase 270, wherein X is the total number of participating consumers(database 260 may include extra databases 270 for potential futureparticipating consumers). Each consumer account balance database 270 mayitself include data corresponding to each consumer's loyalty account. Inparticular, each consumer account balance database 270 may includecumulative general loyalty points totals in loyalty points database 272as well as converted or acquired merchant loyalty dollars for eachparticipating merchant in merchant loyalty databases (274, 275 . . . N),wherein N is the total number of merchant loyalty databases in which aconsumer has earned and/or converted (or may earn or convert) loyaltypoints into merchant-specific loyalty dollars. For example, incentiveengine 102 may include 1,500 general loyalty points for consumer1 indatabase 272. If the consumer desires to apply some of the points tomerchant dollars to be used at The Gap, consumer1 may convert 500 of theloyalty points via conversion module 215 into Gap loyalty dollars. Uponconversion, consumer1 loyalty point database 272 will be reduced to 1000points, while merchantA loyalty dollar database 274 will be increased to500 Gap dollars.

Promotion rules database 280 includes information received from thevarious participating merchants related to the requirements or levels tobe reached by consumers in order for the consumer to earn a particularreward or loyalty points/dollars. Conversion rules 285 is any softwareand/or hardware for suitably converting general loyalty points intomerchant-specific loyalty dollars. Conversion rules 285 may include apoints ratio rule, time limit rule, maximum point conversion rule,restrictions on conversion of general loyalty points into certainmerchant dollars and/or any other restriction or rule which is followedin the conversion process. Conversion rules 285 may also interact withpromotion rules database 280 in order to verify or follow other rules.Consumer purchase records database 290 includes information receivedfrom the various participating merchants regarding purchases by theparticular consumer.

Participating merchant database 250 includes any information related tomerchants that may be utilized by the loyalty system 100. Merchants 104may transmit data to incentive engine 102 in any form and by any meansknown in the art, including any of the communications means describedherein. Merchant database 250 may include, for example, informationregarding products and/or services, UPC data, qualifications forobtaining loyalty points, etc. transmitted by merchants 104 who haveenrolled in loyalty system 100.

Referring next to FIG. 3, the process flow depicted is merely anexemplary embodiment of the invention and is not intended to limit thescope of the invention as described above. It will be appreciated thatthe following description makes appropriate reference not only to thesteps depicted in FIG. 3, but also to the various system components asdescribed above with reference to FIGS. 1-2.

A consumer may register or enroll to participate in loyalty system 100by any methods known and practiced in the art (step 310). In oneembodiment, a consumer registers by interfacing with enrollment module212 to establish a consumer account in consumer account database 260 (asshown in FIG. 2). For example, a consumer may be enrolled automatically(e.g. if the consumer holds an existing account with the loyalty systemoperator), over the phone, at the point of sale, through a paperapplication, through verbal interview, through the mail, through amerchant, or through instant enrollment online via network interface218. Consumer enrollment data may include any of the following: name;address; date of birth; social security number; email address; gender;the names of any household members; a credit card number for chargingany fees that may be associated with participation in the system; surveydata; interests; educational level; products of interest; previouslypurchased or used goods or services and/or any preferred brand names.

Upon enrollment, the consumer may receive a consumer ID (e.g., keycode). The consumer ID may be associated with a household account whichspecifies the consumer as a primary member and permits theidentification of supplementary members associated with the consumer'shousehold who may also earn loyalty points for the consumer. Theconsumer ID may include any device, code, or other identifier/indiciasuitably configured to allow the consumer to interact or communicatewith the system, such as, for example, authorization/access code,personal identification number (PIN), Internet code, otheridentification code, and/or the like which is optionally located on arewards card, loyalty card, charge card, credit card, debit card,prepaid card, telephone card, smart card, magnetic stripe card, bar codecard, radio frequency card and/or the like. The account number may bedistributed and stored in any form of plastic, electronic, magnetic,radio frequency, audio and/or optical device capable of transmitting ordownloading data from itself to a second device. A consumer ID may be,for example, a sixteen-digit credit card number, although each creditprovider has its own numbering system, such as the fifteen-digitnumbering system used by American Express. Each company's credit cardnumbers comply with that company's standardized format such that thecompany using a sixteen-digit format will generally use four spaced setsof numbers, as represented by the number “0000 0000 0000 0000”. Thefirst five to seven digits are reserved for processing purposes andidentify the issuing bank, card type and etc. In this example, the lastsixteenth digit is used as a sum check for the sixteen-digit number. Theintermediary eight-to-ten digits are used to uniquely identify theconsumer.

In accordance with another embodiment of the present invention, system100 permits an open payment system. Since the invention generallyprovides that consumer participation in the system may include the useof a consumer ID, a consumer may use any of multiple payment vehicles(such as cash, check, charge card, credit card, debit card, MasterCard®,Visa®, and/or the American Express® Card for example) to make purchasesat the various merchants and still participate in the system. Thus, inone embodiment, the consumer ID is independent of any particular paymentvehicle, such as a credit card for example. In certain embodiments, themerchant computer and the bank computer are interconnected via a secondnetwork, referred to as a payment network. The payment networkrepresents existing proprietary networks that presently accommodatetransactions for credit cards, debit cards, and other types offinancial/banking cards. The payment network is a closed network that isassumed to be secure from eavesdroppers. Examples of the payment networkinclude the American Express®, VisaNet® and the Veriphone® network.

However, alternate embodiments of the invention may be implemented whichassociate a consumer ID with a particular payment vehicle, such as aconsumer's credit card account, charge card account, debit card account,and/or bank account for example. When a consumer ID is associated withan instrument (e.g., a credit card) from a merchant or third-partyprovider, the merchant need not provide a rewards terminal or otherterminal capable of processing the consumer ID, since the third-partyprovider may process the consumer ID as part of the payment transaction.Thus, in this embodiment, loyalty points may be earned by the consumeron a network-wide level without the merchant's direct participation inthe rewards feature (notwithstanding the merchant's participation intransmitting product data to the system). Moreover, it will beappreciated that a single consumer ID may be associated with multiplethird-party payment vehicles, thereby allowing a consumer to generateloyalty points regardless of the particular payment vehicle selected fora particular purchase.

When a merchant or group of merchants desire to offer a promotion inaccordance with the present invention, the merchant may register as aparticipating merchant (step 315) by submitting certain merchant data tothe participating merchant database 250, such as, for example, merchantIDs, store IDs, SKUs, UPCs, brands of products and/or the like. Priorto, upon and/or after issuance of the loyalty points to consumers, themerchant may pay the administrator of the loyalty system 100 a certaindollar amount for issuing the loyalty points to consumers. In anotherembodiment, the incentive engine 102 may charge the merchant uponredemption of the loyalty points by the consumer. Because the loyaltypoints may be universal and shared among all merchant participants,incentive engine 102 includes various functions to track and monitorloyalty point issuance and/or redemption in order to provide a suitableaccounting of the loyalty points to each merchant.

The merchant may then construct and activate the loyalty point or bonuspoint promotion rules and conversion rules in real-time (step 320) byutilizing the centralized incentive engine 102 and storing the promotionand conversion rules in promotion rules database 280 which allows theappropriate amount of points to be allocated to loyalty point database272 and allows conversion rules 285 to facilitate performing theappropriate conversion of general loyalty points to merchant-specificloyalty dollars in database 274. In one embodiment, a merchant utilizesany computing device to facilitate access to incentive engine 102 vianetwork interface 218. Alternatively, merchant may access and instructincentive engine 102 via any other means such as telephone, fax, mailand/or the like to instruct a customer service representative to inputthe promotion information via display/input device 208. In oneembodiment, the merchant may access a form which includes drop-downmenus of criteria options and which allows entry of point valuesassociated therewith. The form may include promotion rule options suchas, for example, date restrictions for the promotion, maximum number oftotal points to award, a points ratio related to dollar value purchased,maximum number of total points to award to an individual consumer,and/or the like. The form may also include conversion rule 285 options,such as, for example, points ratio rule, time limit rule, maximum pointconversion rule, restrictions on conversion of general loyalty pointsinto certain merchant dollars and/or any other restriction or rule whichis followed in the conversion process. Any of the rules may be set asdefaults by the loyalty system administrator or changed by theadministrator, merchants and/or consumers depending on the level ofaccess that may be configured into the system.

The merchant may offer any type of promotion or conversion rule usingany type of criteria. For example, the promotion may allow points to beearned from one merchant, a group of merchants, a group of merchants ina certain region, a group of merchants with similar or complementaryproducts and/or the like. The customers (upon point issuance or duringconversion) may be restricted to customers in a certain region, who havepreviously purchased from a certain merchant(s), purchased a certainproduct(s), visited a certain merchant(s) a predetermined number oftimes, purchased or visited within a certain time period, purchased apredetermined minimum dollar amount, purchased a predetermined number ofproducts, purchased a type of product, purchased a brand of productand/or the like. Additionally, in other transactional contexts, theconsumer may earn points from other non-purchase behaviors, such asconsumer enrollment data, visiting a Web site, referrals of prospectiveparticipants in the system, completion of a survey or other informationgathering instrument, and/or the like. For instance, a participatingconsumer may earn loyalty points automatically through a triggeringevent, such as visiting a Web site, completing an online survey, orclicking on a banner advertisement for example. Offline, a participatingconsumer may earn loyalty points by purchasing products or services,completing a task or showing their consumer ID to the cashier andtriggering the cashier to provide a “behavior” ID which may be input(e.g., by scanning a bar code on a paper survey for example) into thePOS terminal. In addition to the base loyalty points, a merchant mayoffer bonus points (upon point issuance or during conversion) to incentconsumers to trial a new product, increase the frequency of high marginpurchases and/or the like. Furthermore, incentive engine 102 may allowthe loyalty points to be transferred or shared in certain arrangementssuch as, for example, family points, gifting points to others and/or thelike.

In an exemplary embodiment, the invention allows a consumer toaccumulate general loyalty points from one or more merchants ortransaction card companies. Consumers may earn points by presenting aloyalty identifier at the point of sale (POS) when shopping at amerchant. In one embodiment, the merchant is within a coalition ofparticipating merchants within the loyalty system. The loyalty systemmay facilitate, for example, the recording of where consumers shop, theearning of loyalty points by consumers and the billing of merchants forpoints accordingly. In addition to earning base points, consumers mayalso earn bonus points through bonus point promotions.

After earning loyalty points, consumers may redeem the general loyaltypoints for discounts off new purchases at participating merchants orconvert all or a subset of the loyalty points to merchant specificloyalty dollars (step 323) along with other redemption options, such as,for example, merchandise. The consumer may facilitate interaction withincentive engine 102 via network interface 218 using any communicationmeans disclosed herein, such as, for example, telephone, fax or email acustomer service representative which enters and transmits theinformation to incentive engine 102, and/or utilize Internet,Interactive Voice Response System, consumer terminal 118, POS terminal112, or any other computing or access device. The consumer may reviewthe total points available, total merchant dollars within each merchantdatabase 274, enrollment status and/or the like. The consumer thentransmits the suitable information, such as, for example, desired amountof points for conversion and the particular merchant dollars desired, toincentive engine 102. Incentive engine 102 compares the consumerconversion request to conversion rules 285. If acceptable, the systemconverts the appropriate amount of loyalty points by deleting theparticular amount (or based on a conversion ratio) of loyalty pointsfrom loyalty point database 272 and adds a corresponding amount (orbased on a conversion ratio) of merchant loyalty dollars (or monetaryequivalent) into the appropriate merchant loyalty dollar database (e.g.,274, 276, etc.) as a first value. In another embodiment, the system maystore, for each consumer, the merchant-specific loyalty dollars bymerchant within a remotely-accessible host database or similarly withina smart card database. As part of a re-load process, the consumer mayadd more loyalty points and/or convert loyalty points to merchantdollars (e.g., a third value) at any time in a manner similar to theconversion process above.

Upon conducting a purchase at a particular merchant, the consumer mayutilize a code key to facilitate access to the consumer's own loyaltydollars for the particular merchant. When a consumer presents a consumerID to a merchant 104 at the time of purchasing an item from the merchant104 (step 325), the consumer ID is transmitted to incentive engine 102because the consumer ID includes, for example, certain digits whichcause the POS terminal to suitably access, communicate and transmitinformation with incentive engine 102. Alternatively, if the consumer IDis associated with a transaction card account, the account number may betransmitted to an acquirer and/or issuer, which in turn, transmits theassociated consumer ID to incentive engine 102. After the consumer ID istransmitted to incentive engine 102, it is processed by incentive engine102.

In one embodiment, authentication module 214 analyzes the submittedconsumer ID (step 330) against the pre-established consumer IDs storedin consumer account database 260. In one embodiment, the authenticationmodule 214 may request and/or analyze additional information dependingon the configuration of the system as desired by the administrator,consumers and/or merchants. If the submitted consumer ID matches anactive, valid consumer ID stored in consumer account database 260, theincentive engine 102 recognizes the consumer ID and identifies theconsumer as a participant in the system 100. In an alternativeembodiment, if the consumer ID does not match an existing consumer ID,the system may reject the consumer ID, automatically establish a newconsumer account database within consumer account database 260 orrequest more information from the new consumer.

Upon identifying the consumer as a participant in loyalty system 100,the system may instruct merchant terminal 108 via merchant processor 110to transmit certain purchase data which is captured by merchant POSterminal 112 to loyalty system 100 (step 335). Purchase data may includeany of the following: a SKU number; a unit price; a total transactionprice; the payment vehicle(s) used; a store ID which identifies theparticular store location if a merchant operates more than one store; adepartment ID, if the store has multiple departments; the date of thetransaction; the time of the transaction; the employee ID of the storeclerk who facilitates the transaction; a POS terminal ID to identify theparticular terminal conducting the transaction; any merchant-specificincentive program ID; and/or the like. The merchant POS terminal 112 maycreate a transaction file comprising the consumer data (including aconsumer ID) and purchase data (including each item purchased), and thetransaction file is then stored by the consumer purchase recordsdatabase 290. In another embodiment, the various transaction files maybe consolidated by the merchant processor 110 and then forwarded to themerchant regional processor 114 for further back-office and cumulativedata analysis performed by merchant 104 or by loyalty system 100. In anexemplary embodiment, the transaction file is transmitted by either ofthe merchant processor 110 or the merchant regional processor toincentive engine 102.

After receiving the consumer ID, purchase data and/or any other datafrom the transaction file, the consumer may earn additional loyaltypoints or pay for the product or service using merchant dollars. Withrespect to earning additional loyalty points (step 340), incentiveengine 102 compares the data to promotion rules associated with theparticular merchant or groups of merchants in promotion rules database280 and/or to the consumer purchase records in consumer purchase recorddatabase 290. If the data does not satisfy the requirements set forth ina promotion rule, incentive engine 102 updates the consumer purchaserecords database 290 and may transmit a signal to POS terminal 112,wherein the signal may cause a message or graphic to be displayed on adisplay, illuminate any portion of the POS terminal 112 and/or merchantterminal 108, printed on a receipt, and/or downloaded to a consumercomputer, transaction card, personal digital assistant and/or the like.Further information related to illumination of a terminal may be foundin U.S. Ser. No. 09/734,098, filed on Dec. 11, 2000 and entitled MethodsAnd Apparatus For Illuminating A Transaction Card by inventor Alan J.Zausner, which is hereby incorporated by reference. The signal mayinclude, for example, an indication of the status of the consumeraccount balance from database 270, an indication of points needed toobtain a reward, an indication of the reward that could be obtained, anindication that no reward was allocated during the current purchaseand/or the like.

If the data satisfies the requirements set forth in a promotion rule,incentive engine 102 updates the consumer account balance database 270with the applicable loyalty points. The incentive engine 102 alsofacilitates transmission of a signal to POS terminal 112, wherein thesignal may cause a message or graphic to be displayed on a display,illuminate any portion of the POS terminal 112 and/or merchant terminal108, printed on a receipt, and/or downloaded to a consumer computer,transaction card, personal digital assistant and/or the like. The signalor message may include, for example, an indication of loyalty pointsobtained, an indication of the reward that was (or could be) obtainedbased on the new point balance and/or the like. After the loyalty pointsare allocated to the consumer, the consumer may redeem the loyaltypoints for rewards, prizes, travel, discounts, coupons, tickets, and/orthe like by calling a customer service representative, faxing a request,using an automated ordering system and/or any other system or method forredeeming loyalty points known in the art. Upon redeeming the reward,the incentive engine 102 may reduce or reset the applicable consumeraccount balance database 270.

With respect to purchasing a product or service using merchant dollars(step 345), the system facilitates the application of loyalty dollars tothe purchase transaction as a discount or rebate. Incentive engine 102analyzes the merchant ID information to determine the particularmerchant loyalty dollar database (274, 276, etc) to review, thendetermines the total amount of merchant dollars within the particularmerchant loyalty dollar database. Based on any existing conversionratios for the particular merchant or transaction within conversionrules database 285, incentive engine 102 determines if a sufficientamount of merchant loyalty dollars exist for the requested transaction(which may be a subset of the total charge). If a sufficient amount ofmerchant dollars exists, the system reduces the total charged amount forthe transaction by the monetary equivalent of the merchant dollars.

If a sufficient amount of merchant dollars does not exist, the systemmay inform the consumer by any means disclosed herein. The consumer mayconvert additional general loyalty points (re-load) to merchant dollarsas set forth with respect to step 323 above, the merchant may issue moreloyalty points to the consumer as set forth with respect to step 340above and/or the consumer may transfer merchant dollars from anothermerchant to the particular merchant dollar database which is being usedfor the current transaction. In an alternative embodiment, the purchasemay be charged to a transaction card, then incentive engine 102 notifiesthe transaction card system to reverse or deduct the charge based on themonetary equivalent of the merchant dollars. In another alternativeembodiment, the purchase may be paid by cash or check, then a creditissued to a transaction card or additional points awarded.

The following provides an example of how the system and method may beimplemented. Consumer A converts 5,000 loyalty points to merchantdollars having a monetary equivalent of $50 off his/her purchase at ourparticipating gas station merchant. The points are deducted from theconsumer's general loyalty point account 272 and $50 is credited to theconsumer's merchant loyalty dollar account 274 for the gas stationmerchant (e.g., a first value). When Consumer A conducts a purchasetransaction at the gas merchant, he/she swipes or scans a stored valuecard which transmits the consumer ID (key code) to the loyalty system100. If the amount of the purchase is $10, the $50 credit in theconsumer's gas station merchant loyalty dollar account is reduced by$10. If Consumer A later decides to convert an additional 5,000 loyaltypoints to an additional merchant dollars having a monetary equivalent of$50 again, the total value accumulated in the consumer's gas stationmerchant's loyalty dollar account 274 is now $90. If Consumer A nowdecides to redeem 4,000 loyalty points for merchant dollars having amonetary equivalent of $50 at a grocery store merchant 276, the 4,000loyalty points are deducted from the consumer's general loyalty account272 and merchant dollars having a monetary equivalent of $50 is creditedto the consumer's grocery merchant loyalty dollar account 276 (e.g., asecond value). Consumer A now has two merchant loyalty dollar accounts(274 and 276), namely merchant dollars having a monetary equivalent of$90 to be used at the gas merchant, and merchant dollars having amonetary equivalent of $50 at the grocery merchant. At any time, theconsumer may re-load merchant loyalty dollar accounts 274 and/or 276with additional merchant dollars (e.g., a third value).

The present invention may have been described herein in terms offunctional block components, screen shots, optional selections andvarious processing steps. It should be appreciated that such functionalblocks may be realized by any number of hardware and/or softwarecomponents configured to perform the specified functions. For example,the present invention may employ various integrated circuit components,e.g., memory elements, processing elements, logic elements, look-uptables, and the like, which may carry out a variety of functions underthe control of one or more microprocessors or other control devices.Similarly, the software elements of the present invention may beimplemented with any programming or scripting language such as C, C++,Java, COBOL, assembler, PERL, Visual Basic, SQL Stored Procedures,extensible markup language (XML), with the various algorithms beingimplemented with any combination of data structures, objects, processes,routines or other programming elements. Further, it should be noted thatthe present invention may employ any number of conventional techniquesfor data transmission, signaling, data processing, network control, andthe like. Still further, the invention could be used to detect orprevent security issues with a client-side scripting language, such asJavaScript, VBScript or the like. For a basic introduction ofcryptography and network security, the following may be helpfulreferences: (1) “Applied Cryptography: Protocols, Algorithms, And SourceCode In C,” by Bruce Schneier, published by John Wiley & Sons (secondedition, 1996); (2) “Java Cryptography” by Jonathan Knudson, publishedby O'Reilly & Associates (1998); (3) “Cryptography & Network Security:Principles & Practice” by William Stalling, published by Prentice Hall;all of which are hereby incorporated by reference.

In addition to storing general loyalty points and merchant-specificloyalty points, the present invention, in another embodiment, includesan improved system and method for creating, distributing and/or storingvouchers. As used herein, a voucher includes any product, document,signal, card, data field and/or the like, in any form or mediumdiscussed herein or known in the art (e.g., electronic, paper, bar code,optic, magnetic, etc) suitably configured to include information relatedto a promotion. The voucher may apply to a particular merchant, product,service, manufacturer, distributor, or any group or network thereof. Thevoucher may be valid at any time or place or the validation may belimited or restricted to a particular time, day, time period, seasonand/or the like. The voucher may also be combined with other offers orincentive programs discussed herein or known in the art.

A merchant or any other party may distribute a voucher to any consumer(as previously defined) based upon any criteria, no criteria, priorpurchase history, purchase of a particular product or service, frequencyof purchases, infrequency of purchases, entering a website, entering astore, time within the store or website, dollar amount spent at amerchant, general amount of spend in a time period, number of purchasesand/or the like. In one embodiment, a consumer supplies a consumer ID toa merchant prior to, during or after the consumer purchases a product atthe merchant via a computer terminal or POS terminal. The consumer ID,demographic data, and/or product purchase information is received by aloyalty system. The merchant and/or the loyalty system then determinethe appropriate voucher to distribute to the consumer based upon theconsumer ID, demographic data, and/or product purchase information. Forexample, the system may associate a baby wipe promotion to a voucher forall consumers that purchased diapers during a particular week. Inanother embodiment, the consumer may register her interests with aloyalty system such that the loyalty system may send relevant vouchersto the consumer as a promotion regardless of purchase history.

The loyalty system may send the voucher to a particular consumer viaregular mail, fax, SMS, WAP, interne, email or any other distributionmethod discussed herein or known in the art. The voucher may be storedin a remote database or in a smart card database for later use by theconsumer. The system may also distribute numerous vouchers to numerousconsumers. The consumer may also enter a webpage in order to retrievethe voucher. In one embodiment, the multi-merchant system may convertgeneral loyalty points or merchant-specific loyalty points to a voucherhaving a predetermined value and store the electronic voucher in aremote database or in a smart card database. The consumer may thenutilize a code key or consumer ID to access the voucher. The voucher maybe stored electronically in a remote host or on a smart card in asimilar manner as the storage of the loyalty points discussed herein.For example, the electronic voucher may be stored in the merchantspecific database, the general loyalty point area or an area in thedatabase specifically for storing the electronic vouchers.

After associating the voucher data with the consumer and sending thevoucher to the consumer, the consumer may receive the voucher data atany computer, pager, personal digital assistant, smart card, cellularphone, smart phone, database or POS terminal. In this manner, thevoucher may appear as a text message or the voucher may be printed fromany of the receiving devices. The voucher data or printed document mayinclude any information or indicia in any form (e.g., text, bar code,logo, magnetic stripe, smart chip). The data may include, for example,the name of a consumer, a merchant name or logo, a value and/or a serialnumber. The serial number may be utilized by the sponsoring merchant fortracking, evaluation and fraud prevention. The merchant may utilize theserial number for evaluation by, for example, receiving reports relatedto analysis (e.g., in real time) of the success of the voucher promotionin order to allow the sponsoring merchant to change the promotion on thevoucher in accordance with the consumer response. The serial number mayalso be used to prevent or reduce fraud by acting as a deterrent fromothers attempting to copy the voucher.

After receiving the voucher, the consumer may redeem the voucherdirectly at a merchant, wherein the merchant may include a particularmerchant indicated on the voucher or a chain of merchants, or anymerchant within a particular network of merchants. Obtaining a vouchermay be a strong incentive for a consumer to visit a merchant location ora particular website location, thereby leading to continued visits andthe consumer providing valuable information to the merchant throughregistration of the consumer in the loyalty system or in any othermerchant program. Moreover, the consumer may be motivated to visit a newmerchant, continue shopping at an existing merchant or increasepurchases at a known merchant. The voucher system may also be combinedwith other incentive programs such as, for example, a referral systemwhereby the consumer may obtain additional vouchers for referring newconsumers to the merchant. The voucher system may also allow theconsumer to forward or share the voucher with other consumers.

In the foregoing specification, the invention has been described withreference to specific embodiments. However, it will be appreciated thatvarious modifications and changes can be made without departing from thescope of the present invention. The specification and figures are to beregarded in an illustrative manner, rather than a restrictive one, andall such modifications are intended to be included within the scope ofpresent invention. Accordingly, the scope of the invention should bedetermined by the appended claims and their legal equivalents, ratherthan by the examples given above. For example, the steps recited in anyof the method or process claims may be executed in any order and are notlimited to the order presented.

Benefits, other advantages, and solutions to problems have beendescribed above with regard to specific embodiments. However, thebenefits, advantages, solutions to problems, and any element(s) that maycause any benefit, advantage, or solution to occur or become morepronounced are not to be construed as critical, required, or essentialfeatures or elements of any or all the claims. As used herein, the terms“includes”, “comprising”, or any other variation thereof, are intendedto cover a non-exclusive inclusion, such that a process, method,article, or apparatus that includes a list of elements does not includeonly those elements but may include other elements not expressly listedor inherent to such process, method, article, or apparatus. Further, noelement described herein is required for the practice of the inventionunless expressly described as “essential” or “critical”.

We claim:
 1. A method utilizing a computer system for facilitatingredemption of vouchers including: converting, by said computer systemfor facilitating said redemption of said electronic vouchers, at least aportion of general loyalty points to a first value associated with aspecific first merchant, wherein said general loyalty points areaccessed in a loyalty database in said computer system utilizing aunique identifier, wherein a loyalty account includes said uniqueidentifier and said general loyalty points associated therewith, saidgeneral loyalty points not being associated with a specific merchant;converting, by said computer system, at least a portion of said generalloyalty points to a second value associated with a specific secondmerchant; redeeming, by said computer system, an electronic voucher andsaid first value for a product offered by said second merchant, whereinat least a portion said second value along with voucher information issaved as an electronic voucher, and wherein said redeeming includes:receiving purchase data including purchase price, applying said secondvalue associated with said electronic voucher towards said purchaseprice, transferring at least a portion of said first value stored insaid computer system to said second value, applying said second valuethat is the result of the transfer from said first value towards saidpurchase price, and outputting a resultant balance of said purchaseprice.
 2. The method of claim 1, wherein said electronic voucher isconfigured to include information related to a promotion.
 3. The methodof claim 1, wherein said electronic voucher applies to a particularproduct.
 4. The method of claim 1, wherein said electronic voucher is inthe form of at least one of a paper document, data field, a card,authorization code, magnetic code, bar code, and electronic signal. 5.The method of claim 1, wherein said electronic voucher includes arestriction related to use of said electronic voucher.
 6. The method ofclaim 1, further comprising saving, by said computer system, said firstvalue in a first database in said computer system associated with saidloyalty account.
 7. The method of claim 1, further comprising saving, bysaid computer system, at least a portion said second value along withsaid electronic voucher information as said electronic voucher in asecond database in said computer system associated with said loyaltyaccount.
 8. The method of claim 1, further comprising facilitatingdistribution of said electronic voucher to a consumer.
 9. The method ofclaim 8, further comprising: receiving a consumer ID; determining apromotion based upon said consumer ID; producing said electronic voucherby associating said promotion with said electronic voucher; storing saidelectronic voucher in at least one of a remotely accessible databasehaving data fields related to different merchants and a smart carddatabase having data fields related to different merchants; and,enabling said consumer to receive said electronic voucher and to usesaid promotion associated with said electronic voucher for a purchasefrom a merchant.
 10. The method of claim 9, wherein said determiningstep includes analyzing certain criteria including at least one of:criteria, no criteria, prior purchase history, purchase of a particularproduct or service, frequency of purchases, infrequency of purchases,entering a website, entering a store, time within the store or website,dollar amount spent at a merchant, general amount of spend in a timeperiod, and number of purchases.
 11. The method of claim 9, wherein saidenabling step includes at least one of: allowing access to saidelectronic voucher on a webpage, electronically transmitting saidelectronic voucher to said consumer and sending a printed voucher tosaid consumer.
 12. An incentive engine for facilitating redemption ofvouchers, said engine comprising: a network interface communicating witha memory; said memory communicating with a computer system forfacilitating said redemption of said electronic vouchers; and saidcomputer system, when executing a computer program, is configured to:convert at least a portion of general loyalty points to a first valueassociated with a specific first merchant, wherein said general loyaltypoints are accessed in a loyalty database in said computer systemutilizing a unique identifier, wherein a loyalty account includes saidunique identifier and said general loyalty points associated therewith,said general loyalty points not being associated with a specificmerchant; convert at least a portion of said general loyalty points to asecond value associated with a specific second merchant; redeem anelectronic voucher and said first value for a product offered by saidsecond merchant, wherein at least a portion said second value along withvoucher information is saved as an electronic voucher, and wherein saidredeeming includes: receiving purchase data including purchase price,applying said second value associated with said electronic vouchertowards said purchase price, transferring at least a portion of saidfirst value stored in said computer system to said second value,applying said second value that is the result of the transfer from saidfirst value towards said purchase price, and outputting a resultantbalance of said purchase price.
 13. The incentive engine of claim 12,wherein said incentive engine is located within a remotely-accessiblehost.
 14. The incentive engine of claim 12, wherein said incentiveengine is located within a smart card.
 15. A tangible, non-transitorycomputer-readable medium having computer-executable instructions storedthereon that, if executed by a computer system for facilitatingredemption of electronic vouchers, cause said computer system to performoperations comprising: converting, by said computer system, at least aportion of general loyalty points to a first value associated with aspecific first merchant, wherein said general loyalty points areaccessed in a loyalty database in said computer system utilizing aunique identifier, wherein a loyalty account includes said uniqueidentifier and said general loyalty points associated therewith, saidgeneral loyalty points not being associated with a specific merchant;converting, by said computer system, at least a portion of said generalloyalty points to a second value associated with a specific secondmerchant; redeeming, by said computer system, an electronic voucher andsaid first value for a product offered by said second merchant, whereinat least a portion said second value along with voucher information issaved as an electronic voucher, and wherein said redeeming includes:receiving purchase data including purchase price, applying said secondvalue associated with said electronic voucher towards said purchaseprice, transferring at least a portion of said first value stored insaid computer system to said second value, applying said second valuethat is the result of the transfer from said first value towards saidpurchase price, and outputting a resultant balance of said purchaseprice.